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Piracy Cuts Into Paid App Sales

Hackers have cut into paid app sales by 20 percent to 50 percent
Ninety-two percent of the top 100 paid apps in Apple’s App Store have been hacked
Ninety-two percent of the top 100 paid apps in Apple’s App Store have been hacked

Within days of the May debut of James Vaughan’s 99¢ game, Plague Inc., on the Apple App Store, hackers made it available online for free. Up to 35 percent of the game’s downloads have been illegal, he says. “Piracy is a problem of success,” says Vaughan, whose game lets players infect a virtual world with pathogens. “I can’t be too angry about piracy.” Still, the game has gotten 1.6 million paid downloads, so had all the pirated downloads also been paid, the 25-year-old Londoner would have earned more than $500,000 more.

Long the scourge of the movie, music, and video game industries, pirates have turned their attention to apps, making a significant dent in mobile-app store sales, which researcher Yankee Group expects to generate $10.1 billion this year. There are lots of ways to steal an app; it usually involves copying its code and publishing it on an online forum or a legitimate app store. Sales would be 20 percent to 50 percent higher if it weren’t for piracy, says Carl Howe, a Yankee vice president. “The order of magnitude is tens of thousands to hundreds of thousands of dollars in losses per developer.”